France’s Finance Minister Bruno Le Maire speaks on July 25, 2022 at the Finance ministry in Berlin, Germany.
David Gannon | Afp | Getty Images
French Finance Minister Bruno Le Maire said on Saturday that efforts by G-7 nations to introduce a price cap on Russian oil would require commitment from the wider international community to be successful.
The G-7 economic powers announced Friday that they had agreed on a plan to impose a set price on Russian oil.
The initiative is the latest attempt to apply economic pressure on Moscow over its invasion of Ukraine. But aside from cutting Russia’s oil revenues — a key source of funding for President Vladimir Putin’s war chest — Le Maire said the policy should be implemented as a “global measure against war.”
“You need an outreach because we don’t want this measure to be only a Western measure,” Le Maire told CNBC’s Steve Sedgwick at the Ambrosetti Forum in Italy.
“It should not be a Western measure against Russia, it should be a global measure against war,” he added.
The G-7 — which consists of the U.S., Canada, France, Germany, the U.K., Italy and Japan — is yet to finalize how the price cap will be implemented, a process that Le Maire acknowledged will be “quite difficult.”
However, it is expected to be ready before early December when EU sanctions on seaborne imports of Russian crude kick in.
“We know that we need the unity from all the 27 member states if you want to get the green light for introducing that cap,” he said, referring to the EU bloc of nations, a non-enumerated member of the G-7.
More than that, however, Le Maire said the policy would require participation by other major global economies.
It follows comments from Kadri Simson, the EU’s energy chief, who urged involvement from China and India, both of which have increased their purchases of Russian oil this year, benefiting from discounted rates.
“If we want to be efficient in these sanctions, we need to reduce the revenues that Russia is gaining from oil and gas selling,” Le Maire said.
Europe a ‘third global superpower’
Russia has previously said it will not sell oil to nations that impose a price limit. And following the G-7’s announcement on Friday, Russia’s state-owned energy giant Gazprom said it would not restart gas flows via the Nord Stream 1 pipeline due to technical issues.
It came after gas supplies were already halted last week for a planned “maintenance outage” that was expected to last until Sept. 3.
Paolo Gentiloni, the EU’s economics commissioner, said Saturday that the bloc was “ready to react” to Russia’s decision to stop gas supplies to the region.
France’s Le Maire said separately that Europe’s steadfast opposition to Russia, namely via economic sanctions and international diplomacy, was evidence of the region’s rising status as a “third global superpower.”
“Things are radically changing. Europe is becoming a superpower, not only from an economic point of view but also a political point of view,” Le Maire said.
“I really think that we are moving on the right direction to have Europe playing a part in the 21st century between China and the United States,” he added.